According to a new poll of local authorities, UK councils are preparing to sell social clubs, sports centres, and retail spaces as they bet on a fire sale of assets to stabilize finances.
Growing Fiscal Pressures Prompt Asset Sales
A coalition of councils representing major urban areas in England reported that 60% of councils are intending to sell assets to meet the escalating costs of social services for vulnerable individuals.
Local governments have previously faced criticism for disposing of playing fields and open spaces to support their budgets, but they contend they must proceed to generate essential revenue from asset sales or declare themselves bankrupt.
The group said that a high proportion of authorities seeking to raise money from a fire sale of assets represented “a clear change from 2024, when the largest share (60%) of local leaders said they would prioritise service redesigns and using savings to weather growing fiscal pressures.”
Specific Examples of Proposed Sales
Medway Council in southeast England announced its property management strategy included the sale of a shopping centre in Rainham and a community venue in another town to raise 20 million pounds over five years.
- A local golf course and business parks held in two English counties, which all generate rent for Medway council, will additionally be sold under the plan.
Local Levy Rises and Broader Fiscal Pressures
The survey of councils in the key cities group, which includes several urban centers, also found that over seven in ten of councils will have to raise council taxes next spring to cover the growing cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.
The authority explained it will proceed with property disposals after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to deliver both better provisions and financial savings,” stated Vince Maple.
He added: “We face population challenges which will persist to increase the strains we have. As a unitary authority, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
National Patterns and Forecasts
Research of regional authorities recently further found local finances being stretched by the increasing figures of young people and adults needing Send support.
A network of councils projected that local shortfalls will reach 4.4 billion pounds a year by 2029, as they struggle to manage rising needs.
Ministers have delayed scheduled changes to the Send system until next year after a white paper outlining those reforms was recently delayed.
Disadvantage and Funding Shortfalls
According to the latest indices of deprivation (IMD) covering UK local authorities, several key cities members were included in the most deprived in the country.
- “Member cities like several major towns place in the most deprived 30 across the country under the latest IMD measures,” noted the study.
“While only a single urban area is in the ten most deprived for disadvantaged communities nationally, urban areas are much more prone to be in the most deprived fifth of the nation. The figures highlights the scale of difficulties facing local leaders across major urban centers in the coming year,” the report concluded.
“Council officials have been clear about the need for a equitable and lasting funding system that reflects and addresses the real levels of disadvantage and need,” stated Michael Mordey.
“Lacking this, local authorities will persist to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the detriment of their communities.”
A fifth of councils have cut or compromised care services in the past 12 months, the survey found.
